Tips for Choosing a Quality Liquidity Provider

The forex market has become very popular lately. Thanks to modern technologies, almost any user can start a business on Forex. Moreover, this market is very liquid (also very risky), which attracts a large number of investors. It is not surprising that many brokers are eager to create an exchange in Forex and offer their services to potential clients.

But newbies face serious competition, especially in the first stage. Therefore, it is important to offer users the best conditions: the availability of a wide range of tools, a high level of security, and a fast transaction execution time. And this is where the liquidity provider comes in. It is important for a company to choose an LP that suits its requirements. It is necessary to understand that there is no one-size-fits-all solution, and each company is ready to offer its own conditions. Moreover, the wide selection of different LPs makes the decision-making process difficult. We will show you how to start a forex business as efficiently as possible with a quality and reliable liquidity aggregator. We will also tell you about the features of a reliable LP.

Tips for Choosing a Quality Liquidity Provider

Pay Attention to the Range of Services of your LP

Before creating a business on Forex, you need to choose a quality liquidity provider offering all the products you need. For example, your LP must accept cryptocurrency payments and handle the most digital currencies. This means that it should not only accept bitcoin payments but also work with Ethereum, Dash, Bitcoin Cash, etc. If the broker works not only on Forex, then the liquidity provider must provide access to the market for stocks, securities, metals, etc. In this case, cooperation will be as productive and efficient as possible for both the broker and the trader.

Should a Liquidity Provider Be Regulated?

The Forex market has clear rules and regulations. Financial flows should be regulated by law and brokers should be anti-money laundering. Decentralization has been one of the core principles of cryptocurrency. And there are still unlicensed exchanges where users can transact. And these brokers have access to dark pools of liquidity.

However, we recommend choosing a quality and regulated liquidity provider. In this case, the company can be sure that its interests (and the interests of its clients) are reliably protected by local law. A regulated and licensed LP will not manipulate the market to their advantage, commit illegal acts, etc. Of course, it is necessary to study the history of LP before starting a collaboration. Learn more about the reputation of the liquidity provider, check the license, and explore the track record. In this case, the probability of making the wrong choice is minimal.

List of Opportunities Offered

It is necessary to offer clients a wide range of opportunities. Such an approach will help the broker win the competition for a potential client. Also, you should check all the conditions that LP offers. And if you plan to offer clients work on the MetaTrader4 or MetaTrader5 platform, then you need to discuss this issue with the liquidity provider. It is important that it can meet your expectations and those of your customers. And if you trade not only fiat currencies, then you need to find out if LP accepts crypto payments. And also learn more about potential spreads, commission size, and other financial nuances.

Analyze Customer Needs

A thorough analysis of the market and the creation of a portrait of a potential client will give you an understanding of exactly what tools and capabilities you need. We recommend conducting a dialogue with LP – a partner will help you identify your target audience and offer the best conditions for potential customers. It is important that the liquidity provider and the broker establish good communication and dialogue. This will help to achieve an effective start and eliminate problems with misunderstandings.


Obviously, a quality liquidity provider must provide professional support to its clients. The broker must make sure that he gets access to a manager who is ready to help 24/7. Also, multilingual and quality professional support is important. After all, it is important to solve the problem as soon as possible if it arises. The answers to these questions help you choose the best liquidity provider.

Additional Aspects to Pay Attention To

The broker must assess all possible aspects and weigh all the risks. Find out what kind of assets LP works with, what liquidity is provided, what reputation the company has. Pay attention to the depth of the market – this is an important factor. This indicator gives an idea of ​​the liquidity of a particular currency, as well as the LP’s ability to execute a deal with a minimum delay.

Forex prime brokers prefer to work with licensed and reliable liquidity providers who have an automated reporting system and provide open access to it. It contains information about trades, FIX bridge reporting, swaps/rollovers book, and order book data. Also, high-quality LP makes it possible to work with MetaTrader 4 and 5 platforms, connect API, bridge connections, and FIX protocol. 

Francis Nwokike

Francis Nwokike is a Social Entrepreneur and an experienced Disaster Manager. I love discussing new business trends and marketing tips. I share ideas and tips that will help you grow your business.

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